Gender Inequality, Income, and Growth: Are Good Times Good for Women?

Dollar, D. and R. Gatti (1999). Gender Inequality, Income, and Growth: Are Good Times Good for Women? Policy Research Report on Gender and Development Washington, DC, The World Bank Development Research Group/Poverty Reduction and Economic Management Network. Working Paper Series, No. 1.

Gender differentials in education and health are not an efficient economic choice. Societies that underinvest in women pay a price for it in terms of slower growth and lower income. Furthermore, gender inequality can be explained to a significant extent by religious preference, regional factors, and civil freedom. The relative status of women is poor in the developing world, compared to developed countries. Increases in per capita income lead to improvements in different measures of gender equality, suggesting that there may be market failures hindering investment in girls in developing countries, and that these are typically overcome as development proceeds. Gender inequality in education and health can also be explained to a considerable extent by religious preference, regional factors, and civil freedom. These systematic patterns in gender differentials suggest that low investment in women is not an efficient economic choice, and we can show that gender inequality in education is bad for economic growth. Thus, societies that have a preference for not investing in girls pay a price for it in terms of slower growth and reduced income.